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May : Regulations in terms of Property Valuation Act

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17 May, 2017

Regulations in terms of Property Valuation Act


Re:  DRAFT REGULATIONS: PROPERTY VALUATION ACT (ACT 17  OF 2014)


Please find attached for your information a copy of the abovementioned regulations.

In essence the regulations set out the methodology that must be followed by valuers when valuing property for the purposes of land reform as prescribed by the newly established "Valuer General".  With regards specifically to the valuation of property upon which timber is grown, the following should be noted:

  1. The valuation of the land is determined by adding the current use value and the market value and then dividing the sum by two.
  2. The current use value  is determined  by the net present value as at the date of valuation of the cash inflows generated. If a loss is made, the property thus has no use value.
  3. The timber stock value is then added to the market value only (and not to the current value as well).  The value of the timber is thus only 50% of what it is worth.
The upshot of the above will be to dramatically reduce the "valuation" (in relation to what the valuation would have been if based on market value) of timber estates, and hence the price paid by Government for these properties.

Although FSA will be making a submission by the deadline of 20th June 2017, members are encouraged to make their own submissions as in this specific instance, we believe that the more submissions the Valuer General receives the better.  This is because at recently held workshops, the Valuer General has dismissed organised Agriculture's concerns.


Download PDF document: Draft regulation Property Valuation Act


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